Exploring the Behavioral Drivers of Review Valence: The Direct and Indirect Effects of Multiple Psychological Distances.

Abstract

While the literature has established the effect of online reviews on customer purchase intentions, the influence of psychological factors on online ratings is overlooked. This paper examines these factors under the perspective of Construal Level Theory (CLT). Using review data from TripAdvisor and Booking.com, we study three dimensions of psychological distances (Temporal, Spatial, and Social) and their direct and interaction effects on review valence, using regression analysis. We examine the effect of these distances on the information content of online reviews employing a novel bag-of-words model to assess its concreteness. Temporal and spatial distance have positive direct effects on review valence. Social distance, on the other hand, has a negative direct effect. However, its interaction with the other two distances has a positive effect, suggesting that consumers tend to "zoom-out" to less concrete things in their ratings.The findings provide implications for the interpretation of review ratings by the service providers and their information content. Our study extends the CLT and eWOM literature by jointly exploring the effect of all three psychological distances that are applicable in post-purchase evaluations. Methodologically, it provides a novel application of the bag-of-words model in evaluating the concreteness of online reviews.

Keywords: Construal Level Theory, Online Reviews

JEL Classification: D03, Z31